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November 19, 2012

DFA Partners With Dave DeVoe on New Succession Planning Program

The new program aims to help its advisors develop written succession plans, and they’ll get a valuation of their firm’s worth from Dave DeVoe

Last November, Bryce Skaff called Dave DeVoe two days after DeVoe left Schwab, where he ran the biggest custodian’s advisor M&A division. Skaff, a VP for Financial Advisor Services at Dimensional Fund Advisors, had known DeVoe for some time, but he didn’t place that call merely to offer congratulations on DeVoe starting his own advisor M&A firm.

Instead, he wanted to discuss with DeVoe how, he recalled in an interview on Nov. 13, DFA could help advisors who work with DFA “to be responsible stewards for their clients and employees” when it came to advisor succession planning. “The traditional ways of educating advisors on succession weren’t working,” Skaff said, and they “didn’t motivate action—only 20% of advisors have written programs.”

That initial conversation bore fruit last week with the announcement that DeVoe was launching the Accelerating Success through Transition Planning program, an exclusive coaching program for advisors who work with DFA.

Skaff (left) has spent 15 years with DFA, and as part of DFA’s advisor strategy group, he suspected that after helping advisors build and grow their businesses, “what was next” in responsible advisors’ needs was succession planning. He also knew that it wasn’t a lack of knowledge that kept advisors from actually writing succession plans, but rather a “lack of structure and lack of accountability” that were the hallmarks of existing succession planning initiatives that led them, Skaff says, to this new coaching program.

The program, available to advisors who work with DFA, include in-person workshops, electronic webinars, personal consulting from DeVoe himself, and peer coaching. “Peer coaching lends itself to accountability,” said DeVoe in the same Nov. 13 interview, allowing participants to “learn from an advisor with a similar business grappling with a similar process.”

DeVoe says he’s been working with DFA advisor clients for “my whole career,” and since they tend to share the same investment philosophy and client service philosophy—“high client service, a passion for taking care of their clients, and for thinking creatively”—the universe of DFA advisors makes a good group with which to engage in the coaching program.

The Accelerating Success through Transition Planning program takes six months and comprises 40 hours of class time, including that in-person workshop in which advisors learn the “fundamentals” of succession planning, DeVoe said, and then individual coaching to address the “specific challenges and opportunities associated with each firm.”

Over the course of the program, he continued, participants will be “doing homework,” participating in the peer coaching program with firms of similar size and get the individual consulting from DeVoe. By the conclusion of the program, which begins on Feb. 13, 2013, and runs through August, DeVoe says the 10-20 participants in the first tranche will have a “tailored transition plan, a workbook on the fundamentals of M&A, and a Level-1 valuation” from DeVoe & Co., which is a discounted cash-flow estimate of their firm’s worth.

Skaff says DFA’s regional directors will help identify the best candidates for the program, and the advisors will pay for the program themselves, though the two men declined to say exactly how much the program will cost. Skaff emphasizes that DFA will not share in any revenue from the program, and DeVoe says “the process of writing the check makes sure there’s engagement” from participating advisors.

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